Why you should care

Because there are ways to hack even a rough housing market.

By Sanjena Sathian and Jose Fermoso

The Daily DoseMAY 29 2015

Richard Ruiz is going back to work this week after a nine-month leave from his grocery-packing job, thanks to a herniated disk. He’s used the downtime to work on his new home with his wife. New hardwood floors, new yellow walls; they knocked down one of the walls in the bedroom to open up the living room, replaced the dishwasher and added cabinetry. Their place even has a creamy white coat of paint … and a literal white picket fence skirting its front facade

Hard work. Mature work. Especially for two 20-year-olds, who have made a choice almost no one their age makes: homeownership. In this case, home is a mobile home, and Ruiz and his wife, high school sweethearts, bought it in November, just nine months after their wedding. Now the newlyweds are already planning for their next digs — provided they can flip this one, purchased for just $7,000 — and eventually get a house that can’t be hauled off on wheels.

“I’m the only one of my friends who even owns a home,” he says. “No one else I know even owns a car.”

We all know the rep millennials have. And proprietor of one’s own home is not usually a characterization that follows 20-somethings. Yet today there’s a small but significant cadre of millennials trying to carve out the American dream of homeownership in a most unusual way: by buying a mobile home. Of course, with many of these homes selling for a fraction of a regular house, it’s not quite the traditional route of homeownership. But for a generation that has struggled with a tough job market over the years, the mobile-home option is certainly a creative way to get a footing into the middle class.

Some young people can even turn the tables and help their parents out.

Whatever you call ’em — the Miley Cyrus Generation, millennials — those between the ages of 18 and 35 are officially the largest generation in the U.S. And today, millennials make up just over a quarter of the 20-some million Americans living in mobile homes, according to a 2012 market research report by mobile-home insurer Foremost Insurance. That’s up from 2008, when Foremost’s numbers showed about a tenth of owners were 20-somethings.

Certainly that’s good news to at least one group: their parents. In recent years, with the economy still recovering slowly and college debt bills mounting, many of these kids have had to move back home, sometimes right after graduating from college. Just ask Tammy Spear, whose 27-year-old daughter, Kimberly Brock, owns her own trailer; she moved there after a brief stint in her parents’ mobile home, picking up a three-bedroom for $85,000 in Springfield, Florida. “I really pushed to achieve my goals,” says Brock, a stay-at-home mother whose ex-husband has become her roommate. She says most of her peers live with their parents after trying and failing to make it on their own. For her part, she just “didn’t want to pay rent no more.”

Richard Ruiz and his wife, high school sweethearts, bought their first home in November, just nine months after their wedding.

Indeed, some young people can even turn the tables and help their parents out. Take Rene Trujillo, who bought his home at the age of 30, along with his mother; he, his brother and mom all live together at a park in Mountain View, California, shelling out just $1,000 a month for their lot space. Trujillo and his mother have already paid off the 1,200-square-footplace, and he’s saved enough money to remodel another home for his family back in Mexico.

Ask millennials what on earth they’re doing trying to own a home before having kids, before even having a stable job — most, according to Foremost, earn under $40,000 — and you’ll discover, like landlord Jefferson Lilly, who runs a manufactured home investment and advisory firm, that many tenants are blue collar, often truck drivers or oil-rig workers. For them, it’s a practical decision. Compared to high rents, compared to unseemly low-income housing, it makes more sense to shell out a lump sum for your own space.

Historically, about one in four 20-somethings are heads of their own households, compared with 1 in 2 30-somethings, says Dan McCue, research manager at Harvard’s Joint Center for Housing Studies. That rate has been sinking for millennials, who are marrying later and sticking around in parents’ basements for longer. Now, though, things are beginning to look up; as more millennials age into their late 20s, McCue says, we can expect them to move out and begin to get their own feet under them. When they do that, the housing market will be happy, because new entrants means new homes, new construction and a flurry of healthy activity.

For a generation that has struggled with a tough job market over the years, the mobile-home option is certainly a creative way to get a footing into the middle class.

Granted, mobile-home life in many cases isn’t quite as cushy as the childhood bedroom. Trujillo recalls how his park caught fire from an electrical accident, and during a rainstorm, some of his neighbors’ homes even collapsed into a nearby creek. And, depending on how you see it, this could actually be the worst form of homeownership. The trailer park economy exists almost entirely outside the legal and economic frameworks most owners take for granted. That’s in part because owners technically only own their structures and remain renters of the land on which their homes sit.

Plus, well, McCue points out that the big reason for owning a home is … to not have to rent anymore, or to save up the money for a down payment. And many mobile-home buyers, millennials included, have difficulty obtaining loans — a 20-something with no credit history will struggle with this, you can be sure — so payment comes in a single lump sum. The final wrinkle: Homeownership is an investment only if your home appreciates over time, experts say — which requires a lot of work even when you’re sitting on a sizable couple-hundred-grand family home. Trailers and manufactured houses do not appreciate.

Of course, not all millennials are quite so “grown-up.” Some landlords, like Mark Winner, who rents a small handful of lots to millennials in California’s Central Valley, become skeptical when young people turn flaky, paying rent late and earning themselves an eviction notice. And not all millennials living in parks are strivers; plenty, says Winner, fall more on the lazy end of the spectrum. It’s also not quite the rootedness everyone is looking for. Trujillo (and his mom), like Ruiz, still intends to move on up — and out.

Trujillo says he plans to fix up his place too. It’ll look pretty, smart, adult. He points to a neighbor’s trailer, recently painted, with a veritable American-dream-esque porch and a grill out front. “Like that guy’s.”